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Investment Behavior of Orphan and Nonorphan Investors During COVID-19 in Shanghai Stock Market

Authors Ahmad MI, Zhuang W, Sattar A

Received 4 May 2020

Accepted for publication 28 July 2020

Published 25 August 2020 Volume 2020:13 Pages 705—711


Checked for plagiarism Yes

Review by Single anonymous peer review

Peer reviewer comments 2

Editor who approved publication: Professor Igor Elman

Muhammad Ishfaq Ahmad,1 Weiqing Zhuang,1 Anika Sattar2

1School of Internet Economics and Business, Fujian University of Technology, Fuzhou, Fujian, People’s Republic of China; 2Department of Public Administration and Law, Liaoning Technical University, Fuxin, Liaoning, People’s Republic of China

Correspondence: Weiqing Zhuang
School of Internet Economics and Business, Fujian University of Technology, No.33 Xue Yuan Road, University Town, Minhou, Fuzhou, Fujian, People’s Republic of China
Tel +86-13805012485
Email [email protected]

Purpose: Orphaned children carry many psychological and emotional issues with them throughout their lives, which influence every decision they make, including investment decisions. A lack of self-determination and low confidence may make orphans make more risky decisions than their nonorphan counterparts. In this study, we aimed to see how this risky behavior was reflected in investment choices during the COVID-19 pandemic.
Methods: A well-structured questionnaire was distributed to 230 adult investors (130 orphans and 100 nonorphans) between January 22 and March 13, 2020.
Results: Orphans were found to be risk-takers during the COVID-19 pandemic, as hypothesized from their childhood history. Moreover, female investors showed more sensible (less risky) behavior than male investors when investing in fixed-income securities. Income and age showed significant inverse relationships with risk tolerance, while education showed a positive but insignificant effect.
Conclusion: This study indicates that orphan investors enjoy taking risks and their behavior toward risk remains consistent, even in abnormal conditions, such as a global pandemic. It also suggests that their risk-taking behavior remains stable from orphanhood through to adulthood, contradicting many reports that orphans make reasonable decisions in adulthood.

Keywords: global pandemic, risk-taking behavior, adulthood, investment choices

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